Question

Sunshine, Ivory, and Ebony are partners in an Aviation Flight Training Schools. They have decided t will continue for approximately three months. They share profits and losses liquidation begins on September 8, 2019. o liquidate their partnership. The liquidation begins on September 8, 2019 and 50:30:20 iespectively. The following trial balance was supplied by the partmers just before the Cash Receivables Inventory Notes Receivable (Sunshine) Plant Assets (net) Current Liabilities Sunshine, capital (50%) Notes Payable (Ivory) Ivory, capital (30%) Notes Payable (Ebony) Ebony, capital (20%) $55,000 70,000 80,000 20,000 150,000 (36,000) (122,000) (10,000) (82,000) 23,000) (102,000) Liquidation expenses are estimated to be S9,000 for September, s23,000 for October, and $13,000 for November. The following events occur during the liquidation: September September 20 Inventory is sold for $60,000 September 31 October 15 Plant assets with a book value of S65,000 are sold for $40,000. October November 7 Plant assets with a book value of $50,000 are sold for $30,000. November 8 Receivables are sold to a bank for $35,000 Liquidation expenses for the month are $12,000 30 Liquidation expenses for the month are $20,000 22 The remainder of the plant assets are sold for $25,000. November 31 Liquidation expenses for the month are $9,000. Required: Prepare a schedule of partnership liquidation showing the cash distributions made at the end of each month during the liquidation period. Also prepare the accompanying schedule of safe installment payments. Use the spreadsheet provided for your answers.

Answer 1